CA Court Favors Employees in Trade Secret Decision
Posted by
michael
on from the sanity-prevails dept.
legal_tinker writes "At grep.law, Tait Graves writes: 'In a majority of states, you can be enjoined from starting a new job because of what you know, even if you have done nothing wrong.' A California court just rejected that idea in California."
That's not going to happen soon with the FBI!
by
G0SP0DAR
·
· Score: 4, Insightful
I remember a comical article from/. a while back about the FBI not wanting to hire geeks because so many geeks aren't physically fit. However, that was not the focus of the actual linked story. That basically said that the FBI wants hackers, but their ethical screening keeps them from hiring people who think like hackers. That only eliminates 100% of the candidates! If you know how to gain unauthorized access to a secure network, the FBI wants you, but they won't be able to hire you!
--
Calm down, it's *only* ones and zeroes.
Re:That's not going to happen soon with the FBI!
by
dboyles
·
· Score: 5, Funny
I agree with your post as a whole, but this part kind of struck me:
I watched a TLC program on Mitnick last night, never once did the reporter ask if Mitnick might be socally engineering him with a carefully chosen set of lies to make Mitnick sound like a victim rather than a crook.
What did you expect?
Interviewer: Mr. Mitnick, are you not telling me the whole story, but rather inventing facts in an attempt to mislead me into believing that you really didn't do anything wrong?
KM: Yes. [pause] Damn!
-- --
"Complacency is a far more dangerous attitude than outrage." -Naomi Littlebear
Re:People Laid off from my company
by
rodgerd
·
· Score: 5, Informative
I can work for whoever the hell I want to work for.
This is true in New Zealand to a large extent. The courts have consistently ruled that restraints of trade in employee contracts (a) cannot stop someone earning a living in their chosen field and (b) must be specifically compensated (that is, if you want me to sit on my hands for six months, you have to pay me something for that six months, not just claim my regular salary covers it).
The only provisions which have been consistently upheld here are the ones relating to forbidding employees from soliciting clients or co-workers from their now ex-employer. Also, all bets are off in the case of redundancy (you can't sack someone and then prevent them from earning a living).
Unfortunately, the popularity of the absurdly facistic contracts becoming standard in the US ("We own everything you've ever thought of now aand for ever and you can never work for anyone doing anything more meaningful than burger-flipping again") has influenced many New Zealand companies in the direction of putting illegal provisions in their emploment contracts - either because they're too stupid to consult a competant employment lawyer, or because they're cynically hoping the threat of legal action will allow them to beat employees into line.
If companies put a fraction of the effort they put into trying to terrorise employees into making them happy while they're still at the company they'd probably get better retention of key personel.
That is really only true in certain states, NY being one of the worst offenders. Here in WI we are what is sometimes refered to as a right to work state. Simply put, by and large non-compete agreements (note to parent and et al are different from and NDA as NDA's cover only proprietary info), are not worth the paper they are written on. Sure, a company can force a person to abide by the non compete, if they are willing to pay the persons salary during the period of the non compete. (Like that will happen)
Usually the only other time they are upheld is if they are very narrowly and specifically defined, and do not prevent a person from attaining gainful employment in area of their expertice for a similar salary.
That is just Wisconsin, YMMV, like in New York, where you are basically screwed.
IANAL
Re:People Laid off from my company
by
topham
·
· Score: 4, Insightful
Which is exactly why I believe it should be ILLEGAL to place a clause in an employee contract which is expected to be unenforcable.
It would quickly eliminate the crap from the employee agreements.
Re:People Laid off from my company
by
schon
·
· Score: 4, Insightful
The problem is that the person voluntarily gives up the future use of that knowledge to advance professionally now.
Sorry, but nobody should have to sign away their life just to 'advance professionally'.
And voluntary? Yeah, just like the kids that work in asian sweatshops. They do it cause they love it, right?
If they don't agree to the companies terms, they don't get the knowledge in the first place.
Umm, how exactly is this 'voluntary'?
Sounds a little like "I'll give you this nice, shiny doughnut if you sell me your soul."
Again, the logic can be (and probably is) used by people who run sweatshops.
If a company wants to keep it's employees, it should treat them like people, not inventory.
Much of the world would like America's prosperity and much of the world envies it.
True enough, but I doubt that you could count any developed nations as part of that.
Well, these are the sorts of things you have to
do if you want that prosperity.
Ahem, bullshit.
In case you hadn't noticed, the US isn't really #1 at anything besides tooting their own horns. With the arguable exception of movie production (which is fraught with it's own evils) I'm hard pressed to think of anything that you're better at than the rest of the world.
And in case you hadn't heard, there are much better (as decided by the UN) places to live and work - primarily because of people with your mindset.
allowing people to make agreements between themselves is an expression of freedom
Yes, but who, exactly keeps watch to ensure that one party isn't being taken advantage of. Someone has to watch out that a megacorp with an army of lawyers doesn't take advantage of it's workers.
Or do you believe that all labour laws should be abolished, and we should return to the 'good old days' of child factory workers, and indentured servitude? Because that's exactly where your argument takes you.
Re:People Laid off from my company
by
Stephen+VanDahm
·
· Score: 4, Insightful
"Much of the world would like America's prosperity and much of the world envies it. Well, these are the sorts of things you have to do if you want that prosperity."
Saying that in order to be as prosperous as the US, you have to do everything the American way is like saying that since Grandpa Earl smoked a pack a day and lived to be 100, the secret to long life is to chain smoke. Perhaps NDAs and aggressive IP laws contributed to our prosperity, but perhaps if we didn't have those things, we'd be even more prosperous. Things are too complicated to easily determine what has and hasn't contributed to our success.
I think that there's something essentially un-American about aggressive IP laws. I understand the need to foster creativity, but no one owes anyone else a living. If I rip off your copyrighted work, then you have the right to track me down and prosecute me. But laws like the DMCA restrict consumer choice and consumer freedom based on something that they might do in the future -- this really is an attack on our freedom. Corporations and individuals ought to have IP rights, but the responsibility of looking after those rights belongs to the patent/copyright holder, not to Congress, and not to the regular law-abiding citizen. I don't download MP3's and DIVX movies, and I shouldn't have to be penalized for someone else's problem. If they can't or don't want to track down individual violations, then they should change their business model. No one put guns to the heads of Hollywood execs and told them to make movies.
Steve
Re:USA arrogance.
by
Guppy06
·
· Score: 5, Insightful
"We don't envy American (Govt) war mongering, engineering of governments"
What, you're more proud of European government engineering? Proud of the examples certain EU members have mde of various African and SE Asian countries?
"We have better economic growth than the USA."
First off, after the past year I doubt it. Secondly, just because you're growing faster doesn't mean you've caught up yet.
"We have better social policy - we look after our poor people better. We have fewer homeless people, slums. We have accessible healthcare for all, not just the rich. We have a nicer climate overall."
These have beeen brought up so often that I'm actually getting curious whether or not anybody really has any data on this to back these up.
"We have more glorious beaches with fewer people."
Only if you assume all beaches in the US are on the Florida penninsula, southern California, or Oahu.
"We rarely have to queue for anything for more than five minutes."
And by that I assume you're suggesting that we do?
"Our hospitals are not full of gunshot wounded."
Oh really?
"You get to club us with a big stick if we put a trade tariff on,"
Unless it's GM food, huh? Or just about any produce, for that matter? Bananas ring any bells?
"You trash the world environment and you won't let anyone else attempt to clean up (Kyoto)."
About the only way we're preventing Kyoto from being implemented (which we aren't... or "weren't") is by not signing on. IMO, trying to claim that that is our way of actively trying to prevent outher countries from implementing Kyoto themselves is really stretching it.
"And while you're at it, you might get your UN dues paid."
We might, as soon as UN diplomats start paying off their NYC parking/traffic tickets.
"Disclaimer. I do have friends in the USA who are just as horrified by the pervasive ignorance of their compatriots as I am."
I dislike blind patriotism myself, but I fail to see how your post makes you any better than those you claim to dispise. You don't like how pro-American jingoists make overly-broad, baseless and unprovable statements, but you think that your anti-American jingoism is somehow better? "Proving" that the US is the Great Satan requires just as much proof as "proving" the US is utopian. And either way, silly little catch phrases bleated out by political activist sheep just won't cut it.
"I post anon because I don't like being attacked by the idiots in the majority."
You think you're in the minority here? Obviously you're new to Slashdot. I'm surprised there isn't a "+1 Anti-American" mod option yet.
Try to keep in mind, not all americans are morons.
by
dextr0us
·
· Score: 4, Funny
All americans aren't morons. Seriously. We really don't believe that IP is so precious that someone can be sued for programming and then using that knowledge again. This is bullshit, no matter if you're red blue purple green (or a california court)
Now enough american bashing. Fuck. I'm in favor of global thinking, but not neccessarily the buisness practices that come with it. Try to remember we're all human. I agree with a lot of people in iran, scotland, hell even canada (just a joke people!) and its more global thinking that is going to get us farther.
(enter sarcasm)
actually now that i think about it, i'd much rather be in a place where no one repsects anyones culture. "fucking americans and your intelectual property laws, you've never done anything right" sounds about right.
(/sarcasm)
seriously people..... I thought you were people that are more enlightened and less worried about imaginary boundries......
One thing that americans sure are good at is eating. dont forget we're the most obese country in the world, and damn proud too. Also, we have hip-hop, and you betta reckognize how much of a global influence hip-hop music has had.
biiiiaatttch
-- "Martha Stewart can lick my Scrotum......do i have a scrotum?" -- Sharon Osbourne
Slight clarifications
by
werdna
·
· Score: 4, Informative
Reading the comments, I notice that readers are confusing or conflating various issues -- not terribly, but it may be interesting to understand the various bodies of law applicable here:
1) Trade secret law. This is the body of law that prevents you from using or disclosing certain information disclosed to you, directly or indirectly under certain circumstances amounting to a "confidential relationship." You get nailed either by using or disclosing, or by threatening to do so. Virtually every state has strong TSL. TSL is a species of intellectual property law.
2) Covenants not to compete. This is the body of law governing the enforceability of contract provisions stating that a person promises not to compete with a business entity. State laws vary widely as to enforceability. Some completely prohibit these provisions. Others enforce them skeptically, depending upon their "reasonability." Still others have detailed rules for reasonability as to time and space limitations. Others limit to whether the covenant is necessary to protect a reasonable commercial interest. CNC is a species of antitrust regulation.
3) Inevitable Disclosure Rules. This is the DMCA of trade secret law, and this was the subject of the case here. Various jurisdictions (including, alas, Florida) have taken to the view that enforceable non-compete-like protections can be given, without express covenant, to protect a trade secret when a former employee undertakes a job where the disclosure of the secrets is an inevitable consequence of working there. It is a monster, because it invades and disfigures both trade secret AND covenant policies: ID, like trade secrets, potentially last forever and have no territorial bounds. And ID, like covenants, require no proof of bad intent or misappropriation -- even threatened misappropriation. ID, like DMCA, is neither antitrust nor intellectual property -- it is merely naked technology regulation.
Since covenants and trade secrets, respectively, embody a complex set of balancing issues and policies -- ID, by rejecting those policies, unmoors trade secrets and covenants law from their fundamental justifications, and therefore is as likely to hurt the economy as help it. Like the DMCA, which unmoors copyright law from its fundamental policies, ID risks creation of dangerous rights in gross to a few powerful litigious corporations, with no useful payback to society.
4) "Right to work" law, so far as I know, is simply a euphemism for the proposition that an employer is free to hire or fire any employee on any given day, and cannot be held to contract (union or otherwise) regarding employment on any other basis. Basically, it makes illegal the old union notion of a closed shop. (In this arena, I am no expert, but folks seem to be misusing the term here.) RTW is a species of employment law, slightly akin to a backwards version of antitrust.
Slashdot Mirror
I remember a comical article from /. a while back about the FBI not wanting to hire geeks because so many geeks aren't physically fit. However, that was not the focus of the actual linked story. That basically said that the FBI wants hackers, but their ethical screening keeps them from hiring people who think like hackers. That only eliminates 100% of the candidates! If you know how to gain unauthorized access to a secure network, the FBI wants you, but they won't be able to hire you!
Calm down, it's *only* ones and zeroes.
This is true in New Zealand to a large extent. The courts have consistently ruled that restraints of trade in employee contracts (a) cannot stop someone earning a living in their chosen field and (b) must be specifically compensated (that is, if you want me to sit on my hands for six months, you have to pay me something for that six months, not just claim my regular salary covers it).
The only provisions which have been consistently upheld here are the ones relating to forbidding employees from soliciting clients or co-workers from their now ex-employer. Also, all bets are off in the case of redundancy (you can't sack someone and then prevent them from earning a living).
Unfortunately, the popularity of the absurdly facistic contracts becoming standard in the US ("We own everything you've ever thought of now aand for ever and you can never work for anyone doing anything more meaningful than burger-flipping again") has influenced many New Zealand companies in the direction of putting illegal provisions in their emploment contracts - either because they're too stupid to consult a competant employment lawyer, or because they're cynically hoping the threat of legal action will allow them to beat employees into line.
If companies put a fraction of the effort they put into trying to terrorise employees into making them happy while they're still at the company they'd probably get better retention of key personel.
That is really only true in certain states, NY being one of the worst offenders. Here in WI we are what is sometimes refered to as a right to work state. Simply put, by and large non-compete agreements (note to parent and et al are different from and NDA as NDA's cover only proprietary info), are not worth the paper they are written on. Sure, a company can force a person to abide by the non compete, if they are willing to pay the persons salary during the period of the non compete. (Like that will happen)
Usually the only other time they are upheld is if they are very narrowly and specifically defined, and do not prevent a person from attaining gainful employment in area of their expertice for a similar salary.
That is just Wisconsin, YMMV, like in New York, where you are basically screwed.
IANAL
Which is exactly why I believe it should be ILLEGAL to place a clause in an employee contract which is expected to be unenforcable.
It would quickly eliminate the crap from the employee agreements.
The problem is that the person voluntarily gives up the future use of that knowledge to advance professionally now.
Sorry, but nobody should have to sign away their life just to 'advance professionally'.
And voluntary? Yeah, just like the kids that work in asian sweatshops. They do it cause they love it, right?
If they don't agree to the companies terms, they don't get the knowledge in the first place.
Umm, how exactly is this 'voluntary'?
Sounds a little like "I'll give you this nice, shiny doughnut if you sell me your soul."
Again, the logic can be (and probably is) used by people who run sweatshops.
If a company wants to keep it's employees, it should treat them like people, not inventory.
Much of the world would like America's prosperity and much of the world envies it.
True enough, but I doubt that you could count any developed nations as part of that.
Well, these are the sorts of things you have to
do if you want that prosperity.
Ahem, bullshit.
In case you hadn't noticed, the US isn't really #1 at anything besides tooting their own horns. With the arguable exception of movie production (which is fraught with it's own evils) I'm hard pressed to think of anything that you're better at than the rest of the world.
And in case you hadn't heard, there are much better (as decided by the UN) places to live and work - primarily because of people with your mindset.
allowing people to make agreements between themselves is an expression of freedom
Yes, but who, exactly keeps watch to ensure that one party isn't being taken advantage of. Someone has to watch out that a megacorp with an army of lawyers doesn't take advantage of it's workers.
Or do you believe that all labour laws should be abolished, and we should return to the 'good old days' of child factory workers, and indentured servitude? Because that's exactly where your argument takes you.
"Much of the world would like America's prosperity and much of the world envies it. Well, these are the sorts of things you have to do if you want that prosperity."
Saying that in order to be as prosperous as the US, you have to do everything the American way is like saying that since Grandpa Earl smoked a pack a day and lived to be 100, the secret to long life is to chain smoke. Perhaps NDAs and aggressive IP laws contributed to our prosperity, but perhaps if we didn't have those things, we'd be even more prosperous. Things are too complicated to easily determine what has and hasn't contributed to our success.
I think that there's something essentially un-American about aggressive IP laws. I understand the need to foster creativity, but no one owes anyone else a living. If I rip off your copyrighted work, then you have the right to track me down and prosecute me. But laws like the DMCA restrict consumer choice and consumer freedom based on something that they might do in the future -- this really is an attack on our freedom. Corporations and individuals ought to have IP rights, but the responsibility of looking after those rights belongs to the patent/copyright holder, not to Congress, and not to the regular law-abiding citizen. I don't download MP3's and DIVX movies, and I shouldn't have to be penalized for someone else's problem. If they can't or don't want to track down individual violations, then they should change their business model. No one put guns to the heads of Hollywood execs and told them to make movies.
Steve
"We don't envy American (Govt) war mongering, engineering of governments"
What, you're more proud of European government engineering? Proud of the examples certain EU members have mde of various African and SE Asian countries?
"We have better economic growth than the USA."
First off, after the past year I doubt it. Secondly, just because you're growing faster doesn't mean you've caught up yet.
"We have better social policy - we look after our poor people better. We have fewer homeless people, slums. We have accessible healthcare for all, not just the rich. We have a nicer climate overall."
These have beeen brought up so often that I'm actually getting curious whether or not anybody really has any data on this to back these up.
"We have more glorious beaches with fewer people."
Only if you assume all beaches in the US are on the Florida penninsula, southern California, or Oahu.
"We rarely have to queue for anything for more than five minutes."
And by that I assume you're suggesting that we do?
"Our hospitals are not full of gunshot wounded."
Oh really?
"You get to club us with a big stick if we put a trade tariff on,"
Unless it's GM food, huh? Or just about any produce, for that matter? Bananas ring any bells?
"You trash the world environment and you won't let anyone else attempt to clean up (Kyoto)."
About the only way we're preventing Kyoto from being implemented (which we aren't... or "weren't") is by not signing on. IMO, trying to claim that that is our way of actively trying to prevent outher countries from implementing Kyoto themselves is really stretching it.
"And while you're at it, you might get your UN dues paid."
We might, as soon as UN diplomats start paying off their NYC parking/traffic tickets.
"Disclaimer. I do have friends in the USA who are just as horrified by the pervasive ignorance of their compatriots as I am."
I dislike blind patriotism myself, but I fail to see how your post makes you any better than those you claim to dispise. You don't like how pro-American jingoists make overly-broad, baseless and unprovable statements, but you think that your anti-American jingoism is somehow better? "Proving" that the US is the Great Satan requires just as much proof as "proving" the US is utopian. And either way, silly little catch phrases bleated out by political activist sheep just won't cut it.
"I post anon because I don't like being attacked by the idiots in the majority."
You think you're in the minority here? Obviously you're new to Slashdot. I'm surprised there isn't a "+1 Anti-American" mod option yet.
All americans aren't morons. Seriously. We really don't believe that IP is so precious that someone can be sued for programming and then using that knowledge again. This is bullshit, no matter if you're red blue purple green (or a california court) Now enough american bashing. Fuck. I'm in favor of global thinking, but not neccessarily the buisness practices that come with it. Try to remember we're all human. I agree with a lot of people in iran, scotland, hell even canada (just a joke people!) and its more global thinking that is going to get us farther. (enter sarcasm) actually now that i think about it, i'd much rather be in a place where no one repsects anyones culture. "fucking americans and your intelectual property laws, you've never done anything right" sounds about right. (/sarcasm) seriously people..... I thought you were people that are more enlightened and less worried about imaginary boundries...... One thing that americans sure are good at is eating. dont forget we're the most obese country in the world, and damn proud too. Also, we have hip-hop, and you betta reckognize how much of a global influence hip-hop music has had. biiiiaatttch
"Martha Stewart can lick my Scrotum......do i have a scrotum?" -- Sharon Osbourne
Reading the comments, I notice that readers are confusing or conflating various issues -- not terribly, but it may be interesting to understand the various bodies of law applicable here:
1) Trade secret law. This is the body of law that prevents you from using or disclosing certain information disclosed to you, directly or indirectly under certain circumstances amounting to a "confidential relationship." You get nailed either by using or disclosing, or by threatening to do so. Virtually every state has strong TSL. TSL is a species of intellectual property law.
2) Covenants not to compete. This is the body of law governing the enforceability of contract provisions stating that a person promises not to compete with a business entity. State laws vary widely as to enforceability. Some completely prohibit these provisions. Others enforce them skeptically, depending upon their "reasonability." Still others have detailed rules for reasonability as to time and space limitations. Others limit to whether the covenant is necessary to protect a reasonable commercial interest. CNC is a species of antitrust regulation.
3) Inevitable Disclosure Rules. This is the DMCA of trade secret law, and this was the subject of the case here. Various jurisdictions (including, alas, Florida) have taken to the view that enforceable non-compete-like protections can be given, without express covenant, to protect a trade secret when a former employee undertakes a job where the disclosure of the secrets is an inevitable consequence of working there. It is a monster, because it invades and disfigures both trade secret AND covenant policies: ID, like trade secrets, potentially last forever and have no territorial bounds. And ID, like covenants, require no proof of bad intent or misappropriation -- even threatened misappropriation. ID, like DMCA, is neither antitrust nor intellectual property -- it is merely naked technology regulation.
Since covenants and trade secrets, respectively, embody a complex set of balancing issues and policies -- ID, by rejecting those policies, unmoors trade secrets and covenants law from their fundamental justifications, and therefore is as likely to hurt the economy as help it. Like the DMCA, which unmoors copyright law from its fundamental policies, ID risks creation of dangerous rights in gross to a few powerful litigious corporations, with no useful payback to society.
4) "Right to work" law, so far as I know, is simply a euphemism for the proposition that an employer is free to hire or fire any employee on any given day, and cannot be held to contract (union or otherwise) regarding employment on any other basis. Basically, it makes illegal the old union notion of a closed shop. (In this arena, I am no expert, but folks seem to be misusing the term here.) RTW is a species of employment law, slightly akin to a backwards version of antitrust.